What are you doing differently today to generate revenue? If you haven’t already, you should consider the following:
Sell what they’re buying
One of the most important marketing concepts we work on with our clients is that value comes from context. An umbrella is worth more on a rainy day. This idea gets a lot of attention in marketing strategies for Stage 2 small businesses because (1) the founding (Stage 1) team usually has a good sense of the context of its product or service, but Stage 2 hires often do not and need to be educated about it, and (2) Stage 2 companies are often exploring and entering new markets. They overestimate the intrinsic value of their solution and underestimate how hard it is to understand context in those new markets.
This concept is relevant today because the market and buying dynamics have nearly universally changed. It is important then for a business to take what it does (the umbrella) and figure out how it can help others with the issues they are facing today. In other words, sell what they’re buying.
Which, of course, begs the question – What are they buying?
Align with risk aversion
Each particular market has its own forces at play today – slashed CapEx budgets, increased Web marketing budgets, more people involved in decisions, etc. Looking across many markets, though, the largest force effecting buyers today is risk aversion. What does this mean for small businesses’ marketing strategies?
- Buyers are focused on “pain in the core.” Executives and managers are focused on keeping or making their core business profitable, and that is taking more time than it used to. As a result, buyers don’t have time to work on issues outside of their core business.
Marketing strategy: Connect your offering to pain that buyers are experiencing in their core business (or, for consumers, their necessities).
- Buyers want to do it themselves. This is the DIY economy – sale of paint is up, work for painters is down. DIY is a way to keep more control and to feel like there is less risk. A completely DIY approach is often not productive…and that is what creates the sales opportunity – offering guidance for the customer to be able to do it themselves successfully.
Marketing strategy: Services companies should offer DIY alternatives focused on providing tools or coaching, and product companies should provide an option that builds in coaching/guidance.
- Buyers want to make smaller decisions. The problems that buyers have are no smaller today – in fact, many are bigger – but buyers want to minimize their commitments and solve the problems in smaller steps with tighter control.
Marketing strategy: Chop up your solution in smaller chunks.
- Buyers have shorter horizons. In keeping with the smaller decisions, buyers also are looking to see more immediate results. A year ago, the Phimation team was working on projects that were solving problems that had taken decades to develop and would take two-to-four years to solve. This year, clients and prospects are looking for an impact in two-to-three months. Budgets for projects longer than that are either small or nonexistent.
Marketing strategy: focus on providing immediate results.
- Buyers want predictable costs. For on-going needs that cannot be made smaller or more immediate, buyers want more predictable costs.
Marketing strategy: Add a subscription or “managed services” alternative to your offerings.
Focus on trust
Another aspect of risk aversion is less trust – which is putting a premium on building trust early in the marketing process. In the past, marketing at “the top of the funnel” generally focused on developing awareness first and then building trust with prospects as they expressed interest. Now, small businesses need to focus their marketing on building trust first. How? There are several strategies, and the ones we like best are developing content on the Web that shows how you think and appearing in venues (speeches, articles) that show you as the expert. These are not new ideas, but we recommend strongly overweighting them in your marketing approach today.
Another aspect of today’s trust-dependent sales environment is personal networks are more important than ever. In the past, small businesses may not have had a conscious strategy to tap their networks, but if a company’s traditional marketing approaches are not generating enough revenue, then developing a more thought-out approach to the network is probably the highest ROI communication activity available today. We recently mapped four tiers of contacts for a client and developed strategies to optimize the relationships and value in each tier. We recommend the exercise.
Conclusion
In periods of dramatic economic change, strong strategy and management are needed to identify and act on the trends like the ones outlined above. As Sun Tzu said, “Tactics without strategy is the noise before defeat. Strategy without tactics is the slowest route to victory.”
Small businesses should be assessing their marketing and sales strategies and looking for ways to align them with the current environment on a regular basis.
